How I would build an income portfolio that lasts a lifetime

An ASX income portfolio should not just generate cash today. It should still be producing income decades from now.

That means focusing on businesses built to last, not simply those offering the highest yield at a single point in time. Diversification also matters. Relying on one sector or one earnings stream can leave income vulnerable when conditions change.

If I were building an income portfolio designed to last a lifetime, here is how I would approach it.

Start with leaders

The foundation for me would be high-quality Australian shares with strong market positions and long operating histories.

Commonwealth Bank of Australia (ASX: CBA) would play a central role. It has consistently delivered strong returns on equity and remains one of the most profitable banks in the country. While bank earnings can fluctuate with economic conditions, CBA’s scale and execution provide a level of confidence in its long-term dividend-paying ability.

BHP Group Ltd (ASX: BHP) shares would add exposure to global commodities and fully franked income. Dividends can vary depending on commodity prices, but BHP’s balance sheet strength and asset quality support meaningful shareholder returns over the cycle.

Add essential services income

I think reliable cash flow businesses also deserve a place in a long-term income portfolio.

Telstra Group Ltd (ASX: TLS) provides exposure to essential telecommunications infrastructure. Demand for connectivity is ongoing, and Telstra’s scale and network advantage support relatively steady earnings and dividends.

Include dividend growth

An income portfolio built to last should not rely solely on mature higher-yield shares. It also needs businesses capable of growing dividends over time.

TechnologyOne Ltd (ASX: TNE) shares fit that role, in my opinion. The company has transitioned to a SaaS model, generating recurring revenue and expanding margins. After a sharp pullback, it offers exposure to long-term growth with the potential for rising dividends as earnings continue to expand.

Similarly, Macquarie Group Ltd (ASX: MQG) adds diversified financial exposure. Macquarie’s earnings can be more variable than those of a traditional bank, but its global operations and capital discipline have supported meaningful dividends over time.

Support the portfolio with broad exposure

Even the strongest companies face unexpected challenges. That is why I would include a broad market ETF to support the portfolio.

Vanguard Australian Shares Index ETF (ASX: VAS) provides exposure to the top 300 Australian shares across multiple sectors. It helps reduce reliance on any single stock while still delivering franked dividend income from the broader market.

The ETF acts as a stabiliser. If one company underperforms, the broader exposure can help smooth overall income.

Why diversification matters

No company, no matter how strong, is immune to change.

By combining banking, resources, telecommunications, software, diversified financial services, and a broad index ETF, this portfolio spreads risk across industries and earnings drivers. That diversification supports income durability over the long term.

Foolish takeaway

An ASX income portfolio that lasts a lifetime is built on quality, diversification, and patience.

Commonwealth Bank, BHP, Telstra, TechnologyOne, Macquarie Group, and the Vanguard Australian Shares Index ETF each serve a different purpose. Together, I think they create a mix of steady income, dividend growth potential, and structural resilience.

The post How I would build an income portfolio that lasts a lifetime appeared first on The Motley Fool Australia.

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Motley Fool contributor Grace Alvino has positions in Commonwealth Bank Of Australia and Vanguard Australian Shares Index ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group and Technology One. The Motley Fool Australia has positions in and has recommended Macquarie Group and Telstra Group. The Motley Fool Australia has recommended BHP Group and Technology One. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.